Recently ranked as the nation' "Best Small City" by Money Magazine, Sarasota' lifestyle of sun, beaches, fishing, arts, fine dining and golf make it a top choice for CEOs who are choosing for their corporate headquarters. These corporate headquarters, in turn, attract supporting businesses and communities, according to John Harshman, president of Harshman & Co. A strong technology sector is also developing in Sarasota County, fueling interest in flex space, as well as locations where future expansion can be accommodated without a major relocation.

"The lure of Sarasota' bay views has captured the interest of developers," says Harshman. This marketing feature, along with the revitalization of the downtown and St. Armand' shopping districts, has localized significant development in the downtown area.

Recently, the condominium market has grown significantly, while the rental apartment market in Sarasota has been flat. Anchored by the condominiums at the Ritz-Carlton Hotel, the central bayfront district of downtown Sarasota has experienced tremendous condominium growth. Twelve projects have been completed or planned along the 1.5-mile stretch of Sarasota' bayfront. Most projects contain 40 to 60 units with spacious floor plans and dramatic views of Sarasota' marina area and the downtown skyline. Documented sales in excess of $550 per square foot are grabbing the attention of many developers and owners of lots with bay views and appropriate zoning.

The Ritz-Carlton Hotel is scheduled for completion in early 2002. "This dramatic development will change the face of downtown Sarasota. People and businesses visiting the Ritz will recognize Sarasota for its quality lifestyle," says Harshman.

Along Interstate 75, Lakewood Ranch has seen tremendous office and residential development. Keenan Development of Fort Lauderdale is building the first phase of the 150,000-square-foot University Commons Office Center, the first office product in Lakewood Ranch with I-75 visibility. Keiser College will occupy 50,000 square feet in its first building, scheduled for completion on July 1.

The Renaissance of Sarasota, owned by The Wynnton Group and being constructed by Batson-Cook Co., is the largest new development with 240 of 500 planned residential units completed as part of Phase I of a three-phase mixed-use development. "The original program was for Phase I to be rental apartments, but a strong market initiated an earlier than anticipated conversion to condominiums," says Harshman.

New developers to the Sarasota market include The Wynnton Group, which has offices in Columbus, Ga., Atlanta, Tampa and Sarasota. In addition to the mixed-use Renaissance of Sarasota, the company is developing Five Points Tower, a 195,000-square-foot, Class A high-rise office building in downtown Sarasota.

Residential rents range from $.90 per square foot to $1.80 for some of the high-rise condominiums. Class A, full-service office rents range from $19 to $25 per square foot. Retail rates vary widely. The top of the market is on St. Armand' Circle, at $55 per square foot, with rental rates along South Tamiami Trail averaging $22 per square foot. Office vacancy rate is 10 percent. Residential apartment vacancy is about 10 to 12 percent, according to Harshman.

Areas to keep an eye on in the near future include the I-75 corridor, which continues to attract businesses as well as residential development. "The access to a regional labor pool via I-75 is a huge draw," says Harshman. "It will also be interesting to see what impact new condominium development, the Ritz-Carlton and a new city-approved zoning code will have on the commercial sector in downtown Sarasota."

There appears to be approximately two years of multifamily supply on the market or already planned, he adds. The downtown area has yet to experience the potential impacts of Andres Duany' master plan and zoning code. This will have a significant impact on the downtown area and it is expected to make downtown a better place to live.

John Harshman is president of Harshman & Company.


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